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Justice Department to Investigate ESPN


I've always liked them
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<!--startclickprintinclude--><!-- // BEGIN CONTENT // -->Justice department investigating ESPN

<!--startclickprintexclude-->By Richard Sandomir

New York Times News Service

The Justice Department's antitrust division has opened an inquiry into how ESPN acquires and uses its college football and basketball programming, two television industry executives said.

A lawyer for the antitrust division has begun to contact the athletic conferences.
ESPN and Justice Department officials declined to comment.

The investigation, the executives said, may be examining the practice of warehousing, under which ESPN televises only a small portion of the games it has acquired from a conference, then restricts the conference from making deals with any other television entities.

They said the inquiry could also focus on how ESPN uses football and basketball as leverage with conferences, and how it schedules football games at nontraditional times like Tuesday, Wednesday, Thursday and Friday nights to give colleges national exposure for recruiting.

College football and basketball is omnipresent now, nationally and locally, on CBS and NBC, on the Fox Sports Net regional networks and on TBS. But by any measure, ESPN is the biggest force. It carries several hundred games on ESPN and ESPN2, through syndication and pay-per-view. ABC Sports, its corporate sibling under the Walt Disney Company, carries a full schedule and the major bowl games.

For decades, college football was run by the National Collegiate Athletic Association. But 20 years ago, the Supreme Court ended the NCAA's control over the market for televising college football by regulating the number of appearances teams could make and how much it can charge the networks.

The court ruled that the NCAA had in effect become a "classic cartel." The 7-2 decision was the result of an antitrust suit filed by the University of Georgia and the University of Oklahoma in 1981.

ESPN has the rights to numerous conferences, including the Atlantic Coast, Big East, Big Ten and Southeastern in football and the Big East, Big 12, Big Ten and ACC in basketball.

ESPN and ABC recently renewed their deal to carry ACC football for seven years, at $260 million to $270 million, and to add a conference championship game in 2005. ESPN is in arbitration with the Big East to determine what to pay the conference because of the loss of Miami, Virginia Tech and Boston College to the ACC.